BY: Hana Saada
Washington, D.C. – In a highly anticipated development, senior officials from Algeria’ state-owned energy company, Sonatrach, are set to convene with representatives from Exxon Mobil and Chevron during the upcoming Algerian-American energy forum scheduled for November. This critical meeting promises to culminate months of discussions and could potentially lead to the signing of substantial cooperation contracts in the gas sector between these formidable entities.
The Minister of Energy, Mohamed Arkab, revealed that negotiations with the American oil giants have been steadily progressing and are poised to reach a significant milestone before the close of this year. Consequently, the November forum presents a golden opportunity to solidify discussions with Exxon Mobil and Chevron and potentially ink pivotal partnership agreements.
Sonatrach has already taken strides toward bolstering its relationship with Chevron, having signed a memorandum of understanding in March aimed at mutual investment in gas exploration and exploitation, particularly in the southern regions of Algeria. Meanwhile, talks with Exxon Mobil remain ongoing. This confluence of negotiations marks a transformative juncture in American investment, signifying the reinforcement of their presence in Algeria’s thriving gas and oil market, which has until now been predominantly represented by a single American player, Oxy Petroleum.
Algeria has set ambitious targets for its gas production, aiming for a substantial increase of approximately 53% in the coming years through the revitalization of its natural resources. To achieve this, the nation is banking on foreign investments in the exploration domain.
Minister Mohamed Arkab clarified that discussions with Exxon and Chevron encompass a wide spectrum, encompassing agreements for the exploration of both conventional gas and shale gas reserves. Consequently, the forthcoming cooperation between Sonatrach and these American energy behemoths promises to yield mutually beneficial outcomes. Algeria seeks to diversify its foreign partners while Exxon Mobil and Chevron aim to reassert their presence in a region they had vacated nearly a decade ago.
Algeria’s concentrated efforts over the past two years emphasize its commitment to attract foreign investments in upstream gas. This commitment was echoed by the CEO of Sonatrach, Toufik Hakkar, who affirmed that Algeria provides a conducive environment for foreign investments in the upstream gas sector. The country offers clear regulatory frameworks, significant gas reserves, well-developed infrastructure, strategic partnerships, and attractive tax incentives, making it an enticing destination for energy investments.
Notably, the gas sector in Algeria has witnessed unprecedented dynamism over the past two years, marking a significant departure from decades past. Algeria’s ambitious production objectives aim to meet the needs of a growing domestic market and cater to energy-intensive foreign clientele.
As the Algerian-American energy forum approaches, anticipation mounts for what promises to be a transformative moment in the global energy landscape. The convergence of Sonatrach, Exxon Mobil, and Chevron represents a synergistic partnership that holds the potential to reshape the energy dynamics of the region and bring mutual prosperity to both Algeria and the United States.
